THE National Australia Bank aims to take on its bigger rivals through its own online share trading platform.
NAB will offer day-to-day online broking services through its nabtrade arm, and will also target investors in the fast-growing self-managed superannuation fund sector.
But it faces a battle to make inroads in the online market given the dominance of entrenched competitors including ANZ's Etrade and Commonwealth Bank's CommSec, which control more than half the online broking market, with 1.7 million clients.
The group executive of NAB Wealth, Steve Tucker, declared nabtrade will "change the game" in online broking, despite being a relatively late entrant.
"We've had some incumbents in there that have got some pretty big market shares and having their own way, and what we've been quietly been doing behind the scenes is creating a state of the art technology platform," Mr Tucker said.
Until now NAB has offered limited online trading services, through a trading platform provided through a third party called IWL. However, IWL was acquired by Commonwealth Bank in 2007, which prompted NAB to start thinking about its own in-house system.
The nabtrading platform will be integrated with NAB's customer bank accounts, so funds moving in and out of the trading account takes place in real time. Mr Tucker also promised the quality of stock research would eclipse rival offers.
He said the offering of an online trading platform complements rather than works against the bank's existing full-service brokerage arm, JBWere.
"What we've been able to do now is complete the jigsaw puzzle in terms of the wealth battlegrounds we want to win," he said.
Even so, the prospect of another aggressive online stockbroker represents a headache for traditional full-service brokers. Many are feeling the financial squeeze from the slump in trading volumes.
In its monthly figures released this week, the Australian Securities Exchange said the total number of cash market trades continued to fall in August, down 26 per cent on the corresponding month last year.
But the value of the trades was down 38 per cent, to $167.5 billion.